Google, Verizon dispute lobbying over spectrum

JohnLetzing

SAN FRANCISCO (MarketWatch) -- Illustrating the high stakes of an upcoming auction of valuable wireless spectrum, Google Inc. and Verizon Wireless are in a dispute over methods used to lobby federal regulators over rules that will govern the its sale and use.

A Google
GOOG, +0.57%
attorney criticized Verizon Wednesday for "behind the scenes" lobbying of Federal Communications Commissions officials. Both companies have indicated they'd like to acquire chunks of the 700 megahertz spectrum that will be offered for bidding in January.

Companies are allowed to meet privately with regulators, so long as they file written disclosures detailing those meetings soon afterward. But Google attorney Richard Whitt said in public filings and a Wednesday blog post that Verizon has been less than forthcoming about related matters it has discussed with FCC officials, including Chairman Kevin Martin.

Verizon
VZ, +1.24%
spokeswoman Debra Lewis said the company has no comment on the matter. In public filings with the FCC, Verizon has said the claim that it is improperly lobbying "borders on the absurd."

At issue are so-called "open access" rules for a portion of the spectrum to be auctioned. Google pushed for the open-access rules, which would allow wireless customers to buy handsets or download software different from what's offered by their specific carrier. The Web giant has also said it may be willing to spend billions of dollars to acquire some of the auctioned spectrum itself.

But Verizon, which has been through other such spectrum auctions, has opposed the open-access rules. It's also filed a lawsuit against the FCC seeking to overturn the rules.

In a letter filed with the FCC Monday, Google attorney Richard Whitt cited Verizon's "improprieties" in both lobbying the FCC, while simultaneously pursuing the lawsuit.

Whitt in particular cites a Sept. 17 meeting between Verizon and Chairman Martin where he claims the open-access rules were discussed, though "the actual content of [the meeting] was not disclosed until days after."

"This only undermines the ability of interested parties to assess and respond meaningfully," Whitt said in the letter.

In its own filing with the FCC Tuesday, Verizon attorney Michael Senkowski wrote that "Google's assertion is not correct." Senkowski wrote that during the Sept. 17 meeting with Martin, Verizon did not press for changes in the open-access rules.

The companies are squabbling over a particularly valuable set of airwaves. The block of 700 megahertz spectrum, historically used for television transmissions, is a strong variety that is capable of penetrating walls.

In a separate post on a Google company blog Wednesday, Whitt said Google's complaint was prompted by news reports that "Verizon is lobbying behind the scenes (and in apparent violation of FCC rules)."

Whitt said in his post that Verizon has been furtively attempting to "water down" aspects of the open-access rules, by pressing that those devices sold by the spectrum's acquirer will not have to be open to applications offered by other companies.

But Whitt notes that currently, some 95% of the phones in the U.S. are sold by carriers such as Verizon, meaning that nearly all phones would be sealed off from outside applications if Verizon has its way.

Google's criticisms of Verizon echo those of Frontline Wireless LLC, another smaller proponent of open-access rules. In a filing with the FCC in late September, Frontline Wireless complained that "Verizon is clearly seeking reconsideration" of the open-access rules out of public view, and argued that its arguments "should be placed in the docket for comment."

Still, it remains unclear what plans -- if any -- Google has for participating in the auction.

"We are still carefully analyzing whether and how we might participate," Whitt wrote in his blog post. He added that if Google were to acquire spectrum, it would "encourage third party software applications -- even those that compete directly with our own services."

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